(Bloomberg) -- Alcoa Corp. reported second-quarter earnings that beat analysts’ expectations, with the producer boosting its forecast for aluminum shipments this year as reopening economies lift demand for everything from washing machines to beer cans.
The biggest U.S. aluminum producer reported earnings before interest, taxes, depreciation, and amortization of $618 million, higher than the $599.8 million average of analysts’ estimates compiled by Bloomberg.
- “Alcoa had an excellent second quarter and first half of the year, the strongest since our launch as an independent company in 2016,” said Alcoa Chief Executive Officer Roy Harvey. “This record-setting performance reflects how our strategies are working to deliver results.”
- Aluminum traded in London is up about 27% this year, and through is off to its best start to a year since 2008.
- Goldman Sachs Group Inc. said last month it sees a multi-year bull market driven by aluminum’s role in climate-change mitigation, with prices averaging $2,450 per metric ton this year.
- President Joe Biden’s $579 billion infrastructure deal last month has also buoyed the outlook for U.S. demand.
- Analysts at BMO Capital Markets forecast Alcoa and other metal companies are facing a transition period, with prices and volumes stabilizing after more than a year of sharp gains. In June, Alcoa’s stock posted its first monthly decline since January amid worries that lingering Covid-19 cases are clouding the economic outlook worldwide. China’s effort to cool commodity inflation is also weighing on prospects for metals prices.
- This week, Fed Chair Jerome Powell said the economic recovery still hasn’t progressed enough to begin reducing stimulus.
- The earnings statement was released after the close of regular trading in New York, where Alcoa shares rose at 4:13 p.m.
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